Secure Web Transactions
Sridhar Iyer
K R School of Information Technology
IIT Bombay
sri@it.iitb.ernet.in
http://www.it.iitb.ernet.in/~sri
Overview
ƒ Electronic Commerce
ƒ Underlying Technologies
– Cryptography
– Network Security Protocols
ƒ Electronic Payment Systems
– Credit card-based methods
– Electronic Cheques
– Anonymous payment
– Micropayments
– SmartCards
Commerce
ƒ
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Commerce: Exchange of Goods / Services
Contracting parties: Buyer and Seller
Fundamental principles: Trust and Security
Intermediaries:
• Direct (Distributors, Retailers)
• Indirect (Banks, Regulators)
ƒ Money is a medium to facilitate transactions
ƒ Attributes of money:
– Acceptability, Portability, Divisibility
– Security, Anonymity
– Durability, Interoperability
E-Commerce
ƒ Automation of commercial transactions using
computer and communication technologies
ƒ Facilitated by Internet and WWW
ƒ Business-to-Business: EDI
ƒ Business-to-Consumer: WWW retailing
ƒ Some features:
– Easy, global access, 24 hour availability
– Customized products and services
– Back Office integration
– Additional revenue stream
E-Commerce Steps
ƒ Attract prospects to your site
– Positive online experience
– Value over traditional retail
ƒ Convert prospect to customer
– Provide customized services
– Online ordering, billing and payment
ƒ Keep them coming back
– Online customer service
– Offer more products and conveniences
Maximize revenue per sale
E-Commerce Participants
E-Commerce Problems
Snooper
Unknown
customer
Unreliable
Merchant
E-Commerce risks
ƒ Customer's risks
– Stolen credentials or password
– Dishonest merchant
– Disputes over transaction
– Inappropriate use of transaction details
ƒ Merchant’s risk
– Forged or copied instruments
– Disputed charges
– Insufficient funds in customer’s account
– Unauthorized redistribution of purchased items
ƒ Main issue: Secure payment scheme
Why is the Internet insecure?
ƒ Host security
S
S
C
S
– Client
– Server (multi-user)
ƒ Transmission
security
– Passive sniffing
– Active spoofing and
masquerading
Eavesdropping
A
B
A
C
– Java, Javascript, ActiveX,
DCOM
A
C
Interception
B
C
Replay/fabrication
– Denial of service
ƒ Active content
C
Denial of service
B
A
B
C
E-Commerce Security
ƒ Authorization, Access Control:
– protect intranet from hordes: Firewalls
ƒ Confidentiality, Data Integrity:
– protect contents against snoopers: Encryption
ƒ Authentication:
– both parties prove identity before starting transaction:
Digital certificates
ƒ Non-repudiation:
– proof that the document originated by you & you only:
Digital signature
Encryption (shared key)
m: message
k: shared key
- Sender and receiver agree on a key K
- No one else knows K
- K is used to derive encryption key EK & decryption key DK
- Sender computes and sends EK(Message)
- Receiver computes DK(EK(Message))
- Example: DES: Data Encryption Standard
Public key encryption
m: message
sk: private secret key
pk: public key
· Separate public key pk and private key sk
· Private key is kept secret by receiver
· Dsk(Epk(mesg)) = mesg and vice versa
· Knowing Ke gives no clue about Kd
Digital signature
Sign: sign(sk,m) = Dsk(m)
Verify: Epk(sign(sk,m)) = m
Sign on small hash function to reduce cost
Signed and secret messages
pk2
m
sign(sk1,
m)
Encrypt(pk
2)
pk1
Epk2(Dsk1(m
))
Verify-sign
Encrypt(pk1
)
Decrypt(sk
2)
First sign, then encrypt: order is important.
Digital certificates
How to establish authenticity of public key?
Register
public key
Download
public key
Certification authority
Electronic payments: Issues
Secure transfer across internet
High reliability: no single failure point
Atomic transactions
Anonymity of buyer
Economic and computational efficiency: allow
micropayments
ƒ Flexiblility: across different methods
ƒ Scalability in number of servers and users
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E-Payments: Secure transfer
ƒ SSL: Secure socket layer
– below application layer
ƒ S-HTTP: Secure HTTP:
– On top of http
SSL: Secure Socket Layer
ƒ Application protocol independent
ƒ Provides connection security as:
– Connection is private: Encryption is used after an initial
handshake to define secret (symmetric) key
– Peer's identity can be authenticated using public (asymmetric)
key
– Connection is reliable: Message transport includes a message
integrity check (hash)
ƒ SSL Handshake protocol:
– Allows server and client to authenticate each other and
negotiate a encryption key
SSL Handshake Protocol
ƒ 1. Client "Hello": challenge data, cipher specs
ƒ 2. Server "Hello": connection ID, public key certificate, cipher
specs
ƒ 3. Client "session-key": encrypted with server's public key
ƒ 4. Client "finish": connection ID signed with client's private key
ƒ 5. Server "verify": client's challenge data signed with server's
private key
ƒ 6. Server "finish": session ID signed with server's private key
ƒ Session IDs and encryption options cached to avoid
renegotiation for reconnection
S-HTTP: Secure HTTP
ƒ Application level security (HTTP specific)
ƒ "Content-Privacy-Domain" header:
– Allows use of digital signatures &/ encryption
– Various encryption options
ƒ Server-Browser negotiate
– Property: cryptographic scheme to be used
– Value: specific algorithm to be used
– Direction: One way/Two way security
Secure end to end protocols
E-Payments: Atomicity
ƒ Money atomicity: no creation/destruction of
money when transferred
ƒ Goods atomicity: no payment w/o goods and
viceversa.
– Eg: pay on delivery of parcel
ƒ Certified delivery: the goods delivered is what
was promised:
– Open the parcel in front of a trusted 3rd party
Anonymity of purchaser
Payment system types
ƒ Credit card-based methods
– Credit card over SSL
ƒ Electronic Cheques
– - NetCheque
ƒ Anonymous payments
– - Digicash
- CAFE
ƒ Micropayments
ƒ SmartCards
- First Virtual
-SET
Encrypted credit card payment
ƒ Set secure communication channel between
buyer and seller
ƒ Send credit card number to merchant
encrypted using merchant’s public key
ƒ Problems: merchant fraud, no customer
signature
ƒ Ensures money but no goods atomicity
ƒ Not suitable for microtransactions
First virtual
Customer assigned virtual PIN by phone
Customer uses PIN to make purchases
Merchant contacts First virtual
First virtual send email to customer
If customer confirms, payment made to merchant
Not goods atomic since customer can refuse to
pay
ƒ Not suitable for small transactions
ƒ Flood customer’s mailbox, delay merchant
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Cybercash
ƒ Customer opens account with cybercash,
gives credit card number and gets a PIN
ƒ Special software on customer side sends PIN,
signature, transaction amount to merchant
ƒ Merchant forwards to cybercash server that
completes credit card transaction
ƒ Pros: credit card # not shown to server, fast
ƒ Cons: not for microtransactions
SET:Secure Electronic Transactions
ƒ Merge of STT, SEPP, iKP
ƒ Secure credit card based protocol
ƒ Common structure:
– Customer digitally signs a purchase along with
price and encrypts in bank’s public key
– Merchant submits a sales request with price to
bank.
– Bank compares purchase and sales request. If
price match, bank authorizes sales
ƒ Avoids merchant fraud, ensures money but no
goods atomicity
Electronic Cheques
ƒ Leverages the check payments system, a core
competency of the banking industry.
ƒ Fits within current business practices
ƒ Works like a paper check does but in pure
electronic form, with fewer manual steps.
ƒ Can be used by all bank customers who have
checking accounts
ƒ Different from Electronic fund transfers
How does echeck work?
ƒ Exactly same way as paper
ƒ Check writer "writes" the echeck using one of
many types of electronic devices
ƒ ”Gives" the echeck to the payee electronically.
ƒ Payee "deposits" echeck, receives credit,
ƒ Payee's bank "clears" the echeck to the
paying bank.
ƒ Paying bank validates the echeck and
"charges" the check writer's account for the
check.
Anonymous payments
5. Deposit token at bank.
If double spent reveal
identity and notify police
1. Withdraw money:
cyrpographically encoded
tokens
customer
merchant
3. Send token after adding
merchant’s identity
4. Check validity and send goods
2. Transform so merchant can check
validity but identity hidden
Problems with the protocol
ƒ Not money atomic: if crash after 3, money lost
– if money actually sent to merchant: returning to
bank will alert police
– if money not sent: not sending will lead to loss
ƒ High cost of cryptographic transformations: not
suitable for micropayments
ƒ Examples: Digicash
Micropayments on hyperlinks
ƒ HTML extended to have pricing details with each
link: displayed when user around the link
ƒ On clicking, browser talks to E-Wallet that
initiates payment to webserver of the source site
ƒ Payment for content providers
ƒ Attempt to reduce overhead per transaction
Micropayments: NetBill
ƒ Customer & merchant have account with NetBill server
ƒ Protocol:
– Customer request quote from merchant, gets quote and
accepts
– Merchant sends goods encrypted by key K
– Customer prepares & signs Electronic Purchase Order having
<price, crypto-checksum of goods>
– Merchant countersigns EPO, signs K and sends both to
NetBill server
– NetBill verifies signatures and transfers funds, stores K and
crypto-checksum and
– NetBill sends receipt to merchant and K to customer
Recent micropayment systems
Company
Compaq
IBM
France
Telecom
Payment
system
Millicent
Unique
code
mcent
IBM payment
system
Micrommerce
mpay
microm
Smartcards
ƒ 8-bit micro, < 5MHz, < 2k RAM, 20k ROM
ƒ Download electronic money on a card: wallet on a
card
ƒ Efficient, secure, paperless, intuitive and speedy
ƒ Real and virtual stores accept them
ƒ Less susceptible to net attacks since disconnected
ƒ Has other uses spanning many industries, from
banking to health care
Mondex
ƒ Smart card based sales and card to card
transfers
ƒ Money is secured through a password and
transactions are logged on the card
ƒ Other operation and features similar to
traditional debit cards
ƒ Card signs transaction: so no anonymity
ƒ Need card reader everywhere
ƒ Available only in prototypes
Summary
ƒ Various protocols and software infrastructure
for ecommerce
ƒ Today: credit card over SSL or S-HTTP
ƒ Getting there:
– smart cards,
– digital certificates
ƒ Need:
– legal base for the entire ecommerce business
– global market place for ecommerce
References
ƒ State of the art in electronic payment systems, IEEE COMPUTER
30/9 (1997) 28-35
ƒ Internet privacy - The quest for anonymity, Communications of
the ACM 42/2 (1999) 28-60.
ƒ Hyper links:
– http://www.javasoft.com/products/commerce/
– http://www.semper.org/
– http://www.echeck.org/
– http://nii-server.isi.edu/info/NetCheque/
– http://www.ec-europe.org/Welcome.html/
– http://www.zdnet.com/icom/e-business/